Arizona Public Financing Law Faces Major Supreme Court Test

The U.S. Supreme Court will today hear the first challenge since the 1970s to laws regarding public financing systems for political campaigns. OpenSecrets Blog will be at the Court’s chambers covering the oral argument, but for now, here’s a synopsis of the case at hand:

The Case:McComish v. Bennett

The Issue: Arizona’s public financing system is set up to award an initial grant to participating candidates. Then, over the course of the election, additional funds — up to two times the initial amount — can be doled out to participating candidates. These so-called matching funds are allocated when certain spending thresholds are crossed by either privately funded candidates in the race or outside special interest groups that make independent expenditures in opposition to a publicly funded candidate (or in support of his or her opponent). In this legal challenge, the constitutionality of these triggers is being called into question.

The Supremes: Under Chief Justice John Roberts, the Supreme Court has leaned toward deregulation when it comes to campaign finance issues. A 5-4 majority, led by Roberts, created a political firestorm in January last year when it overturned prohibitions on corporate money funding political advertisements in its Citizens Unitedv. Federal Election Commission decision. In 2008, a 5-4 majority of the court also rejected a campaign finance regulation known as the “Millionaires’ Amendment” in Davisv. Federal Election Commission.

The “Millionaires’ Amendment” was a section of the 2002 Bipartisan Campaign Reform Act (also known as “McCain-Feingold” after its chief U.S. Senate sponsors) that granted candidates who faced wealthy, self-financing opponents an exemption to the normal campaign contribution limits so as to have more cash in their war chests to compete.

Opponents of the Arizona law are hoping the court draws upon Davis and Citizens United to declare the matching fund provisions unconstitutional, while supporters of the measure contend the trigger system is unrelated to the “Millionaires’ Amendment.” The question is whether the court’s four liberal-leaning justices can pick up a vote from Roberts or Justice Antonin Scalia, or whether the more conservative bloc of justices will stick together to further deregulate the nation’s campaign finance system.

The History: Arizona’s voluntary public financing system was enacted after voters narrowly approved a ballot measure in November 1998 in the wake of a political scandal known as AzScam. The Citizens Clean Elections Act applies to candidates for state-wide offices, such as the governor, as well as state legislative races. A lawsuit against the act’s triggers for allocating matching funds was first brought in 2008. In January 2010, a federal district court judge agreed. But in May, the 9th Circuit Court of Appeals sided with the public financing supporters and ruled that the matching funds were, in fact, constitutional. While the outcome of the case was still pending, the U.S. Supreme Court, in June, blocked the disbursement of matching funds for the 2010 election.

During the 2008 election cycle, that last time the public financing system was in place for the entire election, about two-thirds of all candidates in Arizona chose to participate in the system. To qualify for this public financing system, candidates must collect a minimum numberof $5 donations, which varies by type of office. In turn, they receive a grant and agree to abide by certain restrictions, such as foregoing additional money from private donors.

Argument For Public Financing: The state of Arizona, Arizona Secretary of State Ken Bennett and supporters of the state’s public financing system contend in their filings with the Supreme Court that the Citizens Clean Elections Act “deters quid pro quo corruption and the appearance of corruption by providing Arizona candidates with an option to run for office without depending on outside contributions.”

They additionally argue that the public financing system is “tailored to provide candidates in competitive races with sufficient funds to run effective campaigns,” while at the same time protecting taxpayer money by “not overfunding candidates in less competitive races.”

Furthermore, they maintain that the trigger system for awarding matching funds is “not applied in a discriminatory or asymmetric way” and is “simply a method of allocating the total public funds available to publicly funded candidates.” In essence, they say they could provide lump sums to participating candidates, but why waste the taxpayer money?

Argument Against Public Financing: The parties named in the lawsuit who are challenging the law include three Arizona candidates — John McComish, Nancy McLain and Tony Bouie — and two outside groups that have made independent political expenditures, the Arizona Free Enterprise Club’s Freedom Club PAC and the Arizona Taxpayers Action Committee.

Their side argues that the fear of triggering matching funds for their opponents chills speech by non-participating candidates. That is, they say that privately financed candidates may choose to raise less or spend less because they don’t want to trigger subsidies for their opponents. They also contend that a lump-sum initial grant would be preferable to the triggered matching funds.

Additionally, they assert that matching fund provisions compel privately funded candidates and independent groups to fund speech they oppose or even “abhor.”

“Political opponents of participating candidates,” they write in their filings with the Supreme Court, “are punished when their rightful campaign financing triggers hostile speech against them.”

They further contend that the state of Arizona’s anti-corruption arguments are weak and maintain the Citizens Clean Elections Act is based on a desire to “level the playing field,” a rational that the Supreme Court rejected in Davis.

“Davis and Citizens United,” they write, “make it abundantly clear that such egalitarian goals do not justify burdening the exercise of core First Amendment rights under any level of heightened scrutiny.”

Media Contact

Viveca Novak
(202) 354-0111
press@crp.org

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